At the beginning of its birth, Bitcoin swept the world like a storm. In turn, Bitcoin also cultivated a group of people who are committed to creating a future full of Bitcoin. In the process of nurturing this community, Bitcoin formed a network effect. Fast forward to today, we can see that this network effect has developed very rapidly and is mainly concentrated on Bitcoin. There are many reasons for this situation. I think it is more because people cannot clearly reach a consensus on the size of the Bitcoin block. As for the description of the original Bitcoin, the concept of blockchain is still concentrated in BTC, and the big Some people cannot distinguish the initial relationship between Bitcoin and BCH, so BCH cannot share this network effect.
Through this article, I want to tell everyone that BCH needs its own network effect.
Community resource deviation
In the past three years, BCH has not been able to persuade the BTC network ecosystem to use BCH, nor has it built a robust application layer, nor has it been able to continue to expand BCH's share in the digital currency market. Of course, BCH definitely has a strong trading environment and a good payment system, but the user layer is still lacking in essence.
Frankly speaking, from the perspective of business acquisition, globally, due to the efforts of many volunteers to promote, BCH has won some adoption by users and enterprises, but in addition to a few countries and regions such as Australia and Japan, The overall market adoption rate of BCH is not high. I think this is mainly because the community’s publicity resources and technical resources are not invested in suitable areas.
Problems faced by the BCH network effect:
The negative value return of commercial adoption
Lack of user layer based on BCH
DAA's instability leads to unstable user transactions
Commercial adoption has been the focus of the BCH community's efforts to promote BCH value growth. However, compared with the energy spent, the price of BCH has not risen significantly, and the return of adoption on the chain is negative, and the promotion of adoption has not achieved obvious results. The solution is to shift energy from advancing merchant and enterprise adoption to building more applications or platforms. Simply put, the focus shifts from promoting merchants to promoting users. If there are enough users, then businesses and enterprises will naturally accept BCH. If enough corporate customers use a certain currency and show willingness to purchase goods or services, then companies will naturally accept this currency as a payment method for their goods or services. Since BCH is a very low-cost method, companies don't need to invest anything, just start a new wallet and publish their BCH address.
Moving from a merchant approach, we can start to shift our focus to building applications or platforms in a niche environment. We focus on the niche market precisely because BCH is also a niche market. Therefore, by adding the right basic application, BCH may shine in the right market. Therefore, the solution is to build applications in the smallest niche market in an environment with little competition.
For example, customer reward points. Initially, Satoshi Nakamoto also stated that the early use case for Bitcoin was customer reward points, donation tokens, game etc . Satoshi Nakamoto said in an email with Dustin Trammell:
Going further in this direction will also stimulate the secondary effects of BCH applications. For example, this will lead to a surge in SLP development and wallet development, because wallets are essential for any BCH application or platform.
Regarding the DAA issue, it has received special attention from the community in recent months. Bitcoin ABC and BCHN, the main development teams of BCH, will optimize and improve the DAA and set the current top priority technical proposal. At present, BCHN has proposed specific improvements, and the problem of unstable BCH block generation can be quickly repaired.
The way forward
BCH has come a long way since its inception. It's been quite a journey, with the main problem being the lack of a robust application layer. Moving forward, the community should focus on smaller markets with more opportunities for BCH to shine, and we should do so as soon as possible. The new path builds the core application layer of BCH and provides an opportunity to build new network effects and bring BCH to market. This is the way forward for BCH.